The Irish bank may pay a minuscule €7.5m “break fee” if the deal collapses.

Santander is also thought to be interested in AIB’s 22 per cent stake in US bank M&T, which was worth about €1.8bn on Friday. The successful sale of both stakes would net AIB nearly €4.9bn before fees.

CEO Colm Doherty will need to raise €7.4bn for its shattered balance sheet, so it will need €2.5bn more, possibly through a rights issue.